Nucor Corp (NUE)

Cash conversion cycle

		Dec 31, 2023	Sep 30, 2023	Jun 30, 2023	Mar 31, 2023	Dec 31, 2022	Sep 30, 2022	Jun 30, 2022	Mar 31, 2022	Dec 31, 2021	Sep 30, 2021	Jun 30, 2021	Mar 31, 2021	Dec 31, 2020	Sep 30, 2020	Jun 30, 2020	Mar 31, 2020	Dec 31, 2019	Sep 30, 2019	Jun 30, 2019	Mar 31, 2019
Days of inventory on hand (DOH)	days	74.53	69.11	72.11	69.94	67.47	74.11	82.73	82.44	84.35	88.83	91.73	86.09	72.03	64.98	65.55	70.89	69.56	72.88	74.35	76.78
Days of sales outstanding (DSO)	days	31.05	35.01	37.76	—	31.57	—	—	—	38.56	—	—	—	—	—	—	—	—	—	—	—
Number of days of payables	days	27.00	24.43	23.75	25.17	20.41	22.19	29.12	25.09	27.70	29.25	38.58	32.83	28.90	24.13	17.53	21.76	21.76	23.45	21.24	24.70
Cash conversion cycle	days	78.59	79.69	86.11	44.77	78.64	51.92	53.61	57.35	95.20	59.58	53.15	53.26	43.13	40.84	48.02	49.13	47.81	49.42	53.10	52.09

December 31, 2023 calculation

Cash conversion cycle = DOH + DSO – Number of days of payables
= 74.53 + 31.05 – 27.00
= 78.59

The cash conversion cycle for Nucor Corp. has shown some fluctuations over the past eight quarters. In Q1 2022, the cash conversion cycle was at its highest, standing at 96.08 days, indicating a longer period for the company to convert its investments in inventory and other resources into cash inflows from sales.

Subsequently, there was a slight improvement in Q2 and Q3 2022, but the cycle increased again in Q4 2022. The trend continued into Q1 2023, with the cash conversion cycle at 79.18 days, indicating some efficiency in managing its working capital.

However, in the following quarters, there were fluctuations in the cash conversion cycle, albeit at relatively lower levels compared to the peak in Q1 2022. This indicates that Nucor Corp. has been able to manage its cash conversion cycle more effectively, although there are still areas for potential improvement in streamlining its operations to enhance cash flow efficiency.

Overall, the trend in the cash conversion cycle for Nucor Corp. suggests that the company has been working towards optimizing its working capital management, but there may be opportunities to further improve the efficiency of its cash conversion cycle in the future.